AI shares lifted Nasdaq as oil shock checked Dow gains

U.S. equities split last week as renewed strength in artificial intelligence-linked shares lifted the Nasdaq Composite 1.74% and the S&P 500 1.23%, while an oil shock tied to U.S.-Iran tensions left the Dow Jones Industrial Average down 0.5%, according to CNBC. The Dow had closed above 53,000 for the first time on Monday before those gains were reversed as crude prices and Treasury yields rose.

The Nasdaq and S&P 500 have now advanced in four of the past five weeks, CNBC reported, underscoring the continuing influence of large technology and semiconductor stocks on the broader market. The week also showed how quickly investor sentiment can turn when geopolitical risk feeds into energy prices, inflation expectations and rate-sensitive sectors.

Semiconductors swung with AI expectations

Chip shares began the week strongly, with the VanEck Semiconductor ETF rising about 2% on Monday as investors returned to several first-half winners, according to CNBC. The move faded Tuesday after Samsung’s results disappointed investors and Reuters reported that China’s DeepSeek was developing an artificial intelligence chip of its own. Micron fell 4.7% and the VanEck Semiconductor ETF lost almost 4% that day, CNBC said.

The group steadied Wednesday after Apple announced an expanded multiyear agreement with Broadcom that is expected to exceed $30 billion. Apple said the arrangement includes production of more than 15 billion U.S.-made chips and a $1.5 billion expansion of Broadcom’s manufacturing site in Fort Collins, Colorado. Broadcom shares rose nearly 5% Wednesday, CNBC reported.

Broadcom also disclosed in a securities filing that it would supply Apple with custom ASIC silicon products for multiple generations of Apple devices. ASICs, or application-specific integrated circuits, are chips built for defined tasks rather than broad-purpose computing. Bloomberg News has reported that Broadcom is working with Apple on a specialized AI server chip for data centers, CNBC said.

The chip rally resumed Thursday, when the VanEck Semiconductor ETF rose 2.5%, helped by gains of 4.5% in Micron and 7.6% in Sandisk. On Friday, attention shifted to SK Hynix’s U.S. market debut. CNBC reported that the South Korean memory company opened at $170, about 14% above its $149 offering price. Nvidia rose 4% Friday to close at $210.96, its highest close in nearly a month.

Meta detailed AI revenue plans

Meta Platforms rose 15% for the week, CNBC reported, after investors received more detail on how the company may seek returns from its artificial intelligence spending. The company confirmed on July 1 that it was preparing a cloud business to sell unused computing capacity to outside customers, a move that would place it against Amazon Web Services, Microsoft Azure, Google Cloud and smaller cloud providers.

Meta also introduced Muse Image, an AI image-generation model intended for creators and advertisers, and said the technology would support tools in its Advantage Plus advertising platform. On Thursday, Meta unveiled Muse Spark 1.1, which it described as its strongest model for coding and agentic AI tasks, and said developers would be charged for access.

Reuters reported that Meta plans to begin manufacturing its custom AI chip in September as it seeks to double computing capacity next year. CNBC said the chip was co-designed with Broadcom and will be made by Taiwan Semiconductor Manufacturing Co., potentially reducing Meta’s dependence on Nvidia and AMD for some workloads.

Oil revived inflation and rate concerns

Energy markets added pressure after CNBC reported that crude prices jumped Tuesday following an Iranian attack on a Qatari liquefied natural gas tanker near the Strait of Hormuz. West Texas Intermediate crude climbed back to $76 a barrel, while energy shares including ConocoPhillips, Chevron and Marathon Petroleum advanced, CNBC said.

The pressure intensified Wednesday after President Donald Trump said the ceasefire with Iran was “over” and the U.S. military struck 90 Iranian military targets, including air defense systems, according to CNBC. Higher oil prices also pushed the 10-year Treasury yield to its highest level since May, reviving concerns that energy-driven inflation could complicate expectations for Federal Reserve rate cuts later this year.

By Friday, oil prices had eased after Trump said Iran had called to make a deal and talks would continue, CNBC reported. The week left investors balancing two forces that have shaped markets through the year: enthusiasm over AI earnings potential and sensitivity to energy prices, rates and geopolitical risk.

This story draws on original reporting from CNBC.